Essay about External Auditors Must be Independent

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2001. It was the year that every individual; man, woman and children on Earth would remember. There was the September 11 event which was considered the worst terrorist attack that has happened in U.S. history, killing a total of 2, 977 people. And not long after that, in the business world, on December 2, the greatest corporate failure was exposed. The crash of Enron in US, followed by the worldwide collapse of its auditor, Arthur Andersen became one the most popular accounting scandal where it is still being talked about even after a decade has passed. Following this scandal, other massive organizations like WorldCom (2002), AIG (2004), and Satyam Computer Services (2009) shared the same fate. Since then, there have been questions being asked on the issue of the independence of auditors being one of the major contributors to these accounting scandals.

Firstly, it’ll be good to know the definition of auditing. Auditing is the process of evaluation and analysis of business records to determine the accuracy or safety or just to ensure that organizations are maintaining honest financial records and statements. Whereas certain corporations rely on audits conducted by their own employees – whom are called internal auditors – other corporations would utilize the use of external auditors. External auditors are certified audit professions who examine financial records and business transactions in accordance with a fixed set of laws or rules of a company, government corporate, and…

A independent review from an auditor of the companies accounts will have many benefits to the owner for example for example he/she will be satisfied of the workings of that particular department. This will mean that the owner will have confidence of where they should place their funds or research and development if they know for sure that there department’s financial record are in order. This will then allow for the best method to allocate resources allowing for greater efficiency and overall the…

Improvements in reliability of corporate revelation minimize the threat that an investor or a creditor will make poor decision if the information which is provided to them is inaccurate. The threat that is mentioned above is the information risk, that is present everytime creditors or investors use information to assess economic risk of any potential investments. The better the quality of the information, the better chances these users making the right decisions. It means the information risk is…

effective in
preventing major scandals on the lines of Enron and Worldcom.
1.0 ABSTRACT
2.0 ENRON-CORPORATE FIASCOS
3.0 HOW DID THE AUDITORS FAIL TO CATCH PROBLEMS AT ENRON?
4.0 HOW TO PREVENT RECURRENCE OF ENRON?
5.0 NEW RESPONSIBILITIES OF AUDITORS ACCORDING TO SARBANES-OXLEY ACT 2002
6.0 CONCLUSION
7.0 REFERENCES
1.0 ABSTRACT
The responsibility of an auditor is to express an opinion on the financial statements based on his audit which means verification or check in accordance with International…

Currently, an auditor may only resign if he is not the sole auditor of the company and his resignation must be made at a general meeting of the company. If an auditor gives notice in writing to the directors of the company that he wishes to resign, the directors shall call a general meeting of the company as soon as it is practicable. This is for the purposes of appointing an auditor in place of the auditor who wishes to resign and to appoint another auditor. The resignation of the auditor shall take…

authorized officers within the government agency or department, (b) external audit that is conducted by Auditor General to produce Financial Statement & present full report to Parliament every year.
Federal Constitution (under Article 105) and the Audit Act1957 have stated the position, selection, power, remuneration, duties and also the nature of National Audit Department (NAD) in Malaysia. Federal constitution is giving the auditor general freedom in auditing the financial and management statement…

Introduction
Independence is a fundamental to the reliability of auditors’ reports. It is an attitude of mind characterized by integrity and an objective approach to professional works. A professional auditor should work both independent and seen to be so. Nowadays, but, the trend of providing non-audit services to audit clients seem to be sweeping accounting firms all over the world; impacts of independence impairment caused by this trend should not be ignored.
The Meaning of Independence
The…

PAPER
CAS 610, Using the Work of Internal Auditors
Paper for ACCT 343
Auditing
Wendy Popowich
Carrie Prosser
Bachelor of Applied Business Administration – Accounting
NAIT School of Business
Submitted: October 20, 2010
Due: October 20, 2010
TABLE OF CONTENTS
Executive summary 3
Introduction 4
Limitations in changes to the ISA 610 before implementation….. 5
Format and wording changes within the exposure draft 5
Using direct assistance from internal auditors 6
Using examples in the proposed exposure…

OBJECTIVES OF THE STUDY
The objective of the research is to establish whether the auditor has a role to play in ensuring good corporate governance. If an auditor has, what possible stumbling blocks will interfere with his role of ensuring good corporate governance .The research will increasingly look at the issues of fraud and white-collar crimes in corporate governance of a company? That is, what responsibilities do an auditor has in detecting fraud and white-collar crimes. The research will focus on much…

KPMG is one of the largest companies in the world. It is also one of the “Big Four Auditors.” The Big Four Auditors are the largest four international companies that offer services in auditing, tax, consultation and anything to do with legal services. KPMG was founded in 1987 and its headquarters is in Amstelveen, Netherlands. They focus on three lines of services: Auditing, Tax, and Consultation. Collectively, they employ more than 155,000 people across the world. They branch out in about 155 countries…